Industry News

Desirable used cars are getting expensive

You’ve probably noticed that the desirable used cars are getting expensive

We have too. When we say “desirable,” we mean cars that have soul, power, good looks and have provenance – a history- of being performance cars. We’re not talking about a well-equipped Kia, we’re talking about Mustangs, Camaros, Challengers, Chargers, sports cars from every corner of the world.

This includes the aforementioned nameplates, whether they’re from the 1960s right up to today.  For example: Mustangs.  Ignoring the mid 1970s Mustangs, the Mustang has always been a sports car (not counting the Mach-Electric SUV)

So what’s going on? Four things:

  1. Inflation – Doesn’t matter what political party you blame, we are in a period of inflation. So much so, that Social security payments are going up 10% to match inflation because payments are tied to inflation by law.
  2. Short supply of serviceable or restorable vehicles (for older vehicles)
  3. Supply and demand – COVID did lots of damage, and among the casualties were car factories that were shut down. The result was that meaning car dealers who wanted to survive had to scoop up whatever used car they could find at almost any price and those prices were passed along to consumers.
  4.  Electric cars are being mandated globally and at least some people are panicking and trying to scoop up the truly desirable cars before they’re priced out of the market.

In the private seller’s segment, used car prices skyrocketed for every type of vehicle including econoboxes.

And here we are, almost a year since COVID started to cool down,

If you look at used car ads, especially on websites like Bring a Trailer, you can see how prices for cars like early 1990 Toyota Supras are selling for silly money – in some cases, Lamborghini money.  One low-mileage, unmolested Supra sold for $329,000.

Looking at early Datsun 240/260/280Zs, we’re seeing prices from $20,000 and up for decent examples.

Examining prices for more recent cars, the same phenomenon is taking place.

1969 Chevelles start at around $45,000 and special cars, numbers matching and maybe a big block are going from $60,000 to $130,000

In fairness, I remember my high school days back in the 1980s. In 1987, the stock market crashed and the economy went into recession in 1990  and 1991. I had just finished college and was all set to buy my high school dream car: 1970 Z28 split bumper Camaro.  In 1988, I could’ve bought one for $2, 500.  By the time I was ready to buy one again, there were triple that price.  With a mortgage, a new baby and two car payments, the desirable cars were already out of reach for me, at least.

Fast forward to today, here in 2022, and once again, we see prices the for truly desirable cars rapidly moving into the stratosphere.

And so it goes, from used Porsches to used Pontiac, the interesting cars are commanding high prices and until something changes, ( I suspect nothing short of serious depression or a world war) we can assume the prices will continue to creep up.

It’s true of every recession; people become nostalgic for the good old days. This is one reason why Boyd Coddington wheels are still popular among older hot rodders and today’s crop of hot rodders, whether they’re driving new Mustangs or Rat Rods.

What is interesting is that new car dealers are still struggling to fill their lots with new cars. Luxury car company, Bentley ‘s CEO Adrian Hallmark said that sales were only up 3% year to date, but profits have soared He said ‘it’s all about personalization, order blank driven, not stock build driven. It’s the high- margin personalization of the cars that are driving high profits.’

BMW is playing around with that as well, and have been for some time.  New to their options, subscription services like heated seats.  Wand heated seats in your  $70,000 BMW, you have to subscribe and pay monthly fee.

One Nissan dealer has a new 400Z sitting on his lot with a window sticker asing

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